Cartoon – This chart shows
Category Archives: Uncategorized
Molina Healthcare fires its CEO and CFO
http://www.fiercehealthcare.com/payer/molina-healthcare-fires-its-ceo-and-cfo
Citing “the company’s disappointing financial performance,” Molina Healthcare has cut ties with its CEO, J. Mario Molina, and his brother, CFO John Molina.
The Medicaid managed care company announced Tuesday that Joseph W. White, who was its chief accounting officer, will take over the role of CFO and act as the interim president and CEO while Molina seeks a replacement for that role.
Molina’s board of directors took the step of firing the sons of the company’s founder, C. David Molina, “in order to drive profitability through operational improvements,” Chairman Dale B. Wolf said in the announcement.
“With the industry in dynamic transition, the Board believes that now is the right time to bring in new leadership to capitalize on Molina’s strong franchise and the opportunities we see for sustained growth,” he added.
The leadership change comes in the wake of Molina’s revelation in February that it lost $110 million on its Affordable Care Act exchange business last year. On the company’s fourth-quarter earnings call, J. Mario Molina primarily blamed the ACA’s risk adjustment program, which he said uses a methodology that “penalizes low-cost and low-premium health insurers like Molina.”
That was a sharp turnaround from back in September, when the insurer’s CEO said that it had exceeded its own growth targets for its ACA exchange business.
J. Mario Molina has also been an outspoken critic of Republicans’ bill that aims to repeal and replace the Affordable Care Act—a rarity among his peers. In particular, he was critical of the steep funding cuts for Medicaid proposed by the GOP.
Molina’s now-ex-CEO earned $10 million in total compensation in 2016, a slight decrease from the $10.3 million he made the year prior and only one of two executives at the eight largest publicly traded health insurers to take a pay cut.
The Impact of the ACA’s Medicaid Expansion on Hospitals’ Uncompensated Care Burden and the Potential Effects of Repeal
Abstract
Issue: By increasing health insurance coverage, the Affordable Care Act’s Medicaid eligibility expansion was also expected to lessen the uncompensated care burden on hospitals. The expansion currently faces an uncertain future.
Goal: To compare the change in hospitals’ uncompensated care burden in the 31 states (plus the District of Columbia) that chose to expand Medicaid to the changes in states that did not, and to estimate how these expenses would be affected by repeal or further expansion.
Methods: Analysis of uncompensated care data from Medicare Hospital Cost Reports from 2011 to 2015.
Findings and Conclusions: Uncompensated care burdens fell sharply in expansion states between 2013 and 2015, from 3.9 percent to 2.3 percent of operating costs. Estimated savings across all hospitals in Medicaid expansion states totaled $6.2 billion. The largest reductions in uncompensated care were found for hospitals in expansion states that care for the highest proportion of low-income and uninsured patients. Legislation that scales back or eliminates Medicaid expansion is likely to expose these safety-net hospitals to large cost increases. Conversely, if the 19 states that chose not to expand Medicaid were to adopt expansion, their uncompensated care costs also would decrease by an estimated $6.2 billion.
Background
Prior to the Affordable Care Act (ACA), childless, nondisabled adults were ineligible for Medicaid in most states. The ACA allowed states to expand eligibility to nonelderly adults with incomes up to 138 percent of the federal poverty level (roughly $16,400 for an individual and $33,600 for a family of four in 2017). As of March 2017, 31 states and the District of Columbia had expanded Medicaid, while 19 states had not.1
One intended benefit of the Medicaid expansion was to reduce uncompensated care burdens that hospitals face. Uncompensated care is any treatment or service not paid for by an insurer or patient. We define uncompensated care costs as the sum of a hospital’s losses on both charity care (when hospitals forgo or reduce the cost of care) and bad debt (when hospitals bill for services but cannot collect payment).
Our previous research, detailed in a 2016 Health Affairs article, found that hospitals in Medicaid-expansion states experienced a sizeable reduction in their uncompensated care costs between 2013 and 2014, from 4.1 percentage points to 3.1 percentage points of operating costs.2 To see if this uncompensated care decrease has continued, we extended our analysis to 2015 and explored which hospitals saw the greatest decreases in uncompensated care costs.
This issue brief is intended to guide decisions around a possible ACA repeal and further state Medicaid expansions, as well as inform policies aimed at alleviating hospitals’ uncompensated care burden. In 2015, U.S. hospitals provided a total of $35.7 billion in uncompensated care, according to the American Hospital Association.3 However, this burden is unevenly distributed. Safety-net hospitals care for a larger-than-typical share of low-income and uninsured patients. In the past, Medicare and Medicaid disproportionate share hospital (DSH) payments provided significant financial relief to safety-net hospitals. But the ACA mandates a sizeable reduction in DSH payments.
Findings
Uncompensated Care Declines in Expansion States Are Substantial Relative to Profit Margins
To identify trends in uncompensated care burdens for hospitals in expansion and nonexpansion states, we used data from Medicare Hospital Cost Reports to create a sample of 1,154 hospitals that report financial data for the calendar year. Focusing on hospitals within the 75th percentile, 50th percentile, and 25th percentile of the uncompensated care cost distribution, we found that between 2013 and 2014, these costs markedly declined in expansion states, and this downward trend continued into 2015 (Exhibit 1). The trajectories of uncompensated care costs were similar for hospitals across the three percentiles. In contrast, we found no similar break from historical trend in nonexpansion states.
Essential Facts About Health Reform Alternatives: Continuous Coverage Requirement
http://www.commonwealthfund.org/publications/explainers/2017/apr/continuous-coverage-requirement
How would continuous coverage work?
Proposed alternatives to the Affordable Care Act (ACA) would require Americans to continuously carry health insurance coverage or be penalized with higher premiums. Under the American Health Care Act (AHCA)—the Republican bill introduced in the U.S. House of Representatives and subsequently withdrawn—people whose insurance coverage lapsed for more than 63 days would be charged a 30 percent premium surcharge every month for 12 months when they repurchase coverage. This penalty was intended to encourage people to maintain coverage and ensure the stability of insurance markets.
Health insurers rely on the premiums collected from relatively healthy individuals to cover the higher health care costs incurred by sicker people. Without a sufficient number of healthy enrollees, insurance can become extremely costly. There is even a possibility of markets falling into a “death spiral,” in which premiums rapidly increase as more and more healthy people leave high-cost plans.
Since 2010, the ACA has prohibited insurers from denying coverage or charging more to people with preexisting health conditions. To stabilize insurance markets, the ACA offers tax credits to help people afford their insurance premiums and requires everyone to purchase insurance coverage or else pay a tax penalty. The individual mandate, in combination with tax credits, was intended to draw the relatively healthy into the insurance market to compensate for the influx of people with medical conditions who were now guaranteed the right to purchase coverage.
While the coverage guarantee for preexisting conditions is one of the ACA’s most popular features, the individual mandate has been more controversial. The AHCA would preserve most protections for people with preexisting conditions but discard the individual mandate. In place of the mandate, the bill includes a requirement that individuals continuously carry insurance coverage.
<h4<what’s the=”” backstory?<=”” h4=””>
How does a continuous coverage requirement differ from current policy?
The ACA requires households without health insurance to pay a penalty equal to the higher of 2.5 percent of their adjusted annual income or $695 per adult and $347.50 per minor child, with the maximum set at the average premium for a bronze plan (about $2,676 in 2017). The AHCA would replace this policy with a requirement that everyone carry insurance at all times. Adults without insurance for more than 63 days would have to pay a premium surcharge of 30 percent to their insurance company when buying a plan in the individual market.
How would the continuous coverage requirement affect consumers?
Under the House Republicans’ proposal, many consumers would be required to pay the premium surcharge. According to a 2016 survey, 21 percent of adults between ages 19 and 64, or 40 million people, either had a gap in their health insurance coverage or were uninsured at the time of the survey.1 If the AHCA’s continuous coverage requirement had been in effect in 2016, an estimated 30 million working-age adults would have paid a premium surcharge had they tried to purchase coverage in the individual market—because they were uninsured for longer than three months.2
The cost to consumers would vary depending on age. Because insurers under the AHCA would be allowed to charge higher premiums to older people, this population would also face higher penalties for failing to maintain continuous coverage. For example, a 50-year-old who failed to maintain continuous coverage would be charged a $2,161 surcharge over 12 months—$1,154 more than a 30-year-old.3
Because it is tied to the premium and not to income, the AHCA’s surcharge would also likely be more punitive for people earning less than $100,000 compared to the ACA’s individual mandate penalty, which is limited to either a flat fee or a percentage of income.4 Older adults, who have higher average premiums, and people living in high-cost regions would also pay more under the AHCA. Finally, the ACA penalty applies only to the months in which a person is without coverage; the AHCA premium surcharge applies to the full year.
How would the continuous coverage requirement affect insurance markets?
Some insurers are concerned that a continuous coverage requirement like that included in the AHCA will not be an effective way of stabilizing insurance markets. One CEO of a major insurer participating in the ACA’s individual marketplaces warned that replacing the individual mandate with a continuous coverage requirement could produce much sicker risk pools, triggering premium increases of 30 percent or more.5
In fact, the way the AHCA’s continuous coverage requirement is structured might discourage individuals from purchasing insurance. Because the surcharge is not paid until a person purchases a health plan, it may act as a strong disincentive to enroll.6 The nonpartisan Congressional Budget Office estimates that initially the surcharge would encourage about 1 million people to purchase coverage in 2018. But in most of the following years, the surcharge would deter up to 2 million people annually from purchasing health coverage.7 Those individuals opting out of insurance would tend to be healthy, resulting in worsening risk pools and making health insurance more expensive for everyone else.
Amendment to ACA Repeal-and-Replace Bill Likely to Increase Premiums and Decrease Covered Services for Many
http://www.commonwealthfund.org/publications/blog/2017/apr/amendment-aca-repeal-and-replace-bill
Yesterday, House Republicans released an amendment to the American Health Care Act (AHCA), their proposed repeal and replacement of the Affordable Care Act (ACA). Congressional Budget Office (CBO) projections of its effects on coverage and the federal budget are not yet available.
The amended version of the AHCA is still likely to significantly increase the numbers of uninsured Americans, raise the cost of insurance for many of the nation’s most vulnerable citizens, and, as originally proposed in the AHCA, cut and reconfigure the Medicaid program. The new amendment specifically allows states to weaken consumer protections by, for example, permitting insurers to charge people with preexisting conditions higher premiums.
What the Amendment Leaves in Place
The amended proposed bill does little to change many provisions of the original AHCA including:
- a phase out of the ACA’s Medicaid expansion;
- capped federal payments to states for their Medicaid programs;
- flat premium tax credits for individual market coverage that adjust for age but not income or premiums;
- the option for insurers to charge older people as much as five times what they charge young people;
- replacement of the ACA’s individual mandate penalties with a premium surcharge for those who fail to maintain continuous coverage;
- repeal of taxes that helped fund the ACA’s coverage provisions;
- state funding for reinsurance or other programs to stabilize the individual market.
The CBO estimated in March that the combined effects of these provisions would increase the number of people without health insurance by 24 million by 2026. Older Americans would be particularly hard hit by the bill, experiencing much higher premiums relative to the ACA and the greatest coverage losses.
What the Amendment Changes
The amendment offers states the option to apply for waivers to reduce ACA consumer protections that have enabled people with health problems to buy private health insurance. Beginning in 2019, states could waive the ban on charging people with preexisting conditions higher premiums, as long as states set up special programs to help people with conditions like cancer or heart disease who could no longer afford coverage. States could also change the ACA’s required minimum package of health benefits for health plans sold in the individual and small-group markets.
Despite the fact the federal ban on preexisting condition exclusions would remain under the AHCA, as Tim Jost points out, insurers could reach the same end by not covering services like chemotherapy that sick people need, or by charging very high premiums for individuals with expensive, preexisting problems. In addition, waiving the ACA’s essential benefit requirement could weaken other consumer protections like bans on lifetime and annual benefit limits and caps on out-of-pocket costs.
States that allowed higher premiums for people with health problems would be required to set up programs such as high-risk pools or reinsurance for high claims costs. Or under an AHCA amendment proposed earlier in the month, states could also participate in an “invisible risk-sharing” program, a hybrid between a high-risk pool and reinsurance for high claims costs. But while reinsurance options might protect insurers from high claims costs, giving them the ability to charge premiums based on health status would result in many people with preexisting conditions facing unaffordable premiums. As for high-risk pools, prior research has found that such pools operated by states before the ACA were expensive both for states and for people enrolled in them, and covered only a small fraction of the individuals who would have benefited.
States that had these programs in place could also let insurers charge premiums based on health for people who had not maintained continuous coverage in the prior year.
Looking Forward
Setting aside the amended AHCA’s potential effects on the health and health care of Americans, many questions and uncertainties remain about the bill’s timing and fate. First, the rush to introduce and pass it quickly seems likely to run afoul of Congress’ need to pass a spending bill this week that will keep the federal government funded beyond April 28. So it could be weeks before an amended AHCA gets serious consideration in the House. An important benefit of delay would be to give the CBO time to analyze the impact of the amendments.
Second, the fate of the amended AHCA in the Senate remains uncertain. Some possible provisions – affecting essential health benefits, premium increases based on health, and other features – may not withstand scrutiny by the Senate parliamentarian as she evaluates whether they are appropriate parts of a budget reconciliation bill, and thus exempt from filibuster. Furthermore, many moderate Senate Republicans reportedly have concerns about the Medicaid provisions of the AHCA.
Third, the complex legislative maneuvering around the AHCA should not detract attention from the fundamental facts. Health insurance saves lives and protects Americans from crippling medical debt and even bankruptcy. Changes to existing legislation that result in fewer insured Americans will undermine the health and quality of life of millions of people, as well as increase economic inequality in this country.
House passes ObamaCare repeal
House Republicans on Thursday passed legislation aimed at repealing and replacing ObamaCare, taking a major step toward a long-held goal and setting in motion an overhaul of the nation’s health system.
The narrow 217-213 vote is a victory for GOP leaders, who faced a tumultuous path to getting the bill to the floor. The measure had to be pulled in March because of a lack of votes, but a series of deals since then brought on board the conservative Freedom Caucus and then wavering moderates.
The bill, known as the American Health Care Act, repeals the core elements of ObamaCare, including its subsidies to help people get coverage, expansion of Medicaid, taxes and mandates for people to get coverage.
In its place, the bill provides a new tax credit aimed at helping people buy insurance, though it would provide less help than ObamaCare to low-income people.
The Congressional Budget Office found that 24 million more people will become uninsured over the next decade because of the bill. While some of that loss is because of people choosing not to get coverage when the mandate is repealed, much of it would come from Medicaid cuts and the smaller tax credit as well.
Republicans brought the measure to a vote without an analysis from the Congressional Budget Office on the updated bill, meaning lawmakers did not have the full nonpartisan analysis of what the bill would do.
In addition, while Republicans have long argued that Democrats rammed through ObamaCare in 2010, the final changes to the Republican bill were only released the night before the vote.
Republicans’ main argument is that ObamaCare is failing and needs to be replaced. They point to insurers pulling out of certain markets, while Democrats counter that uncertainty from Republican efforts to weaken the law are to blame.
“It’s been a winding road to this point but we’re here today to fulfill the promise that we made to the American people,” said Rep. Diane Black (R-Tenn.) who led GOP floor debate on the measure.
“Under ObamaCare, the situation is getting worse every day,” she said. “We can’t wait a moment longer than necessary to provide relief for the American people by repealing and replacing ObamaCare.”
House Democratic Leader Nancy Pelosi (Calif.), meanwhile, called the measure a “very sad, deadly joke.”
Pointing to the hundreds of billions of dollars in tax cuts, she said the bill “will have the biggest transfer of wealth in the history of our country — Robin Hood in reverse.”
The measure has deep cuts to Medicaid, the government healthcare program for low income people, including putting a new cap on payments and ending ObamaCare’s expansion of the program after 2020.
The bill was a tough vote for some electorally vulnerable members of Congress. Many remained publicly undecided until the last moment as leaders furiously whipped lawmakers over the last several days.
Rep. Mike Coffman (R-Colo.), for example, came out as a “no” hours before the vote. He cited the lack of a CBO analysis as well as weakening protections for people with pre-existing conditions.
The key move to bring the Freedom Caucus on board was an amendment that allows states to repeal one of ObamaCare’s key protections for people with pre-existing conditions, known as community rating. If that were repealed in a state, insurers could go back to charging exorbitant premiums to sick people, which could put coverage out of reach for many.
Republicans counter by pointing to money for high risk pools. A last-minute addition of $8 billion more in funding for people with pre-existing conditions was key to winning over several wavering moderates, though many experts doubt whether that will be close to enough funding.
The measure is expected to undergo a major overhaul in the Senate, especially on the Medicaid front, where several Republican senators from states that accepted the expansion are wary of cutting it off.
The path in the Senate is also even tougher, given that Republicans can lose only two votes and still pass the bill.
Watch live: House debates and votes on Republican bill to repeal and replace Obamacare
Republicans will once again try to repeal the Affordable Care Act when the House votes on a highly controversial health care bill Thursday afternoon. Watch the vote live in the player above.
The current House bill would not fully repeal the 2010 Affordable Care Act, but it would kill major elements of that Democratic law. For example, the American Health Care Act would nix the requirement that most Americans purchase insurance, but it would keep in place a provision allowing younger Americans to stay on their parents’ health plans until age 26.
Obamacare repeal: Republicans scramble in 11th hour with new health plan
House Republicans will take another crack at repealing Obamacare on Thursday in a high-stakes vote on legislation that would dramatically revamp the health care system and will serve as a major test for the GOP Congress and the Trump administration.
The Republican bill, hotly contested and highly controversial, was the subject of 11th-hour negotiations and last-minute sweeteners, as GOP leaders scrambled for enough votes to push it through the House and send it to the Senate.
“There’s been a lot of drama, a little bit of trauma along the way,” said Rep. Tom Cole of Oklahoma, a member of the House GOP leadership. He said the vote count is “fairly close,” but he expressed confidence the bill would pass.
Cole and other Republicans shrugged off questions Thursday morning about whether they were allowing lawmakers enough time to read the bill, debate it, and understand its impact.
“It’s a false narrative to say that this has been a rushed process,” said Rep. Larry Buschon, R-Ind., who noted that Republicans have been debating and drafting bills to repeal the Affordable Care Act for more than six years.
The current House bill would not fully repeal the 2010 Affordable Care Act, but it would kill major elements of that Democratic law. For example, the American Health Care Act would nix the requirement that most Americans purchase insurance, but it would keep in place a provision allowing younger Americans to stay on their parents’ health plans until age 26.
The Republican proposal would repeal the ACA’s tax credits, which are based on income and the cost of health insurance in their local market, and replace those with less generous tax credits based on age.
The most contentious element centers on how to deal with patients who have pre-existing conditions, such as cancer, asthma, or diabetes. The Affordable Care Act bars insurance companies from discriminating against those with pre-existing conditions. The GOP bill would weaken that protection by allowing states to seek a waiver for insurance companies to charge people with pre-existing conditions higher premiums than other consumers.
In an effort to woo moderate Republicans who feared that would put insurance costs out of reach for many sick patients, GOP leaders and the White House agreed to include an extra $8 billion to help patients with existing health problems — a sum that critics said was far short of what would be needed to cover the expenses of patients with chronic health conditions.
That tweak won over several key holdouts and gave the GOP much-needed momentum for the bill just as the White House ratcheted up pressure for a House vote this week.
“I support the bill with this amendment,” said Rep. Fred Upton, R-Mich., after meeting with President Trump at the White House on Wednesday morning about his proposal to beef up funding to help individuals with pre-existing conditions. Upton is an influential player on health care policy, and he had previously opposed the bill amid concerns it would undermine protections for those with pre-existing conditions.
Another holdout, Rep. Billy Long, R-Mo., also switched from a “no” to a “yes” after meeting with Trump and working with Upton on his amendment. Long said he and Upton “sold” Trump on their amendment and agreed to switch their votes after he committed to support it.
But the measure still faces fierce resistance.
A bevy of patient advocacy groups, including the American Heart Association and the American Cancer Society, strongly opposed the bill despite the tweaks offered by Upton and others. In a letter urging lawmakers to reject the proposal, 10 health organizations said the measure would undermine key patient safeguards, lead to higher out-of-pocket expenses, and jeopardize coverage for millions of Americans.
“This bill is fundamentally harmful to patients,” the letter stated.
As the House opened debate on the issue, Democrats said the measure would unravel consumer protections and put Americans back at the mercy of the insurance industry.
“The Republican health care bill is reckless and heartless,” said Rep. Rosa DeLauro, D-Conn. “It will have threatening consequences for millions of Americans. It will cost lives.”
Republicans strongly defended the bill, noting that under the Affordable Care Act, premiums have skyrocketed and many insurers have withdrawn from the state and federal exchanges, leaving consumers with high costs and scarce options.
“We are saving health care,” Rep. Chris Collins, R-N.Y., said as he and other Republicans left a closed-door GOP meeting on the measure.
With Democrats unified against the measure, GOP leaders can only lose about 22 Republicans and still pass the bill. The proposal has been a tug-of-war between the moderate and conservative factions inside the House Republican Conference during weeks of intense negotiations and embarrassing setbacks.
By the count of various news outlets, about 20 lawmakers said they’d vote “no” as of Wednesday afternoon and about two dozen others remained undecided, but the tallies remained highly fluid as House leaders and President Trump lobbied individual holdouts and won over converts.
As they left their Thursday morning meeting, Republicans expressed confidence they would have enough support to pass the measure, although the vote could be a down-to-the-wire squeaker. Even if the House approves the bill, it faces uncertain prospects in the Senate. Some Senate Republicans are lukewarm about the House bill, and Senate Democrats are fiercely opposed.
“Its chances for survival in the Senate are small,” said the Senate’s top Democrat, Chuck Schumer of New York, on Wednesday.
House to vote Thursday on Obamacare repeal bill
http://www.cnn.com/2017/05/02/politics/republican-health-care-bill/
BREAKING: The House will vote Thursday on the GOP bill to repeal and replace Obamacare.
Majority Leader Kevin McCarthy said the bill will pass.
“We will be voting on the health care votes tomorrow. Because we have enough votes. It’ll pass. It’s a good bill,” McCarthy, R-California, told reporters.
“We’re gonna pass it. We’re gonna pass it,” he added. “Let’s be optimistic about life.”
—
An eleventh-hour deal renewed momentum for House Republicans working to repeal and replace Obamacare, as leaders Wednesday furiously lobby undecided or skeptical lawmakers on the plan that has been teetering on the brink of collapse.
House leaders have made clear that if everything goes their way, their preference is to have a vote Thursday. But they won’t call a vote unless they believe it will pass.
Vice President Mike Pence is on Capitol Hill. Members have been walking in and out of the speaker’s office all day.
The change in mood comes after GOP Reps. Fred Upton and Billy Long met with President Donald Trump at the White House and flipped their votes from “no” to “yes.” Trump committed to backing an amendment spending $8 billion over five years to fund high-risk pools and go toward patients with pre-existing conditions.
The new “yes” votes mark an incremental but symbolically important victory for the White House and Republican leaders, who have been trying without success for weeks to revive a health care bill that was pulled from the House floor in March.
Other than Long and Upton, there have not been major switches from the “no” to “yes” category, but several undecided members are seemingly open to the new changes.
The focus is on moderate lawmakers concerned the GOP bill will erode too many protections in Obamacare. As originally introduced, the bill would leave 24 million fewer people insured by 2026 than under Obamacare, the non-partisan Congressional Budget Office said.
But the House Freedom Caucus, a group of conservatives who helped scuttle the previous bill in March, now supports the legislation.
Importantly, the Freedom Caucus continues to back the bill Wednesday, even with the new spending being added.
Freedom Caucus Chairman Mark Meadows said only one member of the group opposes the bill. “We’re not going to lose any votes because of it,” he said.
The situation remains extremely fluid.
The future of the bill “as uncertain as we’ve seen it,” a Republican involved in the health care talks said.
Around the same time that Upton and Long unveiled their moves to “yes,” their colleague, Rep. Carlos Curbelo of Florida, declared on Twitter that he opposed the bill.
“I just reiterated to @HouseGOP leaders that #AHCA in its current form fails to sufficiently protect Americans with pre-existing conditions,” Curbelo said.
New Jersey Rep. Leonard Lance, a moderate Republican opposed to the bill, also told CNN Wednesday morning that Upton’s proposed change would not sway him to support the health care legislation. Lance also noted that he has not heard from Trump or Vice President Mike Pence in several weeks
.
Moderate Reps. Charlie Dent, Frank LoBiondo and Jaime Herrera Beutler say they still oppose the bill even with the Upton amendment.
